Good afternoon,
My clients are soon to be single. For 2020, they underpaid the appropriate amount for withholdings (an approximate $1800 shortfall), therefore the system created estimated payment coupons. Which won't be applicable very soon. It seems better to create a 'rough draft' mid-year to see where they are and to make adjustments considering they are moving from a MFJ status to S, curious how others have handled such a situation.
Thank you,
Dawn
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They could be going from a shortfall to breakeven or refund if they are parting ways. Run a projection now to see where they will be for 2021.
They could be going from a shortfall to breakeven or refund if they are parting ways. Run a projection now to see where they will be for 2021.
Use caution in your situation - in general. Anything which could turn into the least bit controversial on their final joint return, be sure to document that each of them agree to what you are doing, Don't be later put in a position where looking back someone can construe that you were favoring one over the other.
Just and area to exercise your normal due caution.
Best wishes, Jeff
Sometimes it may be better to only represent one after a divorce so no possible conflicts of interest may be stated, at least this is what seminar instructors and others may say.... personally I do not mind if both leave, I have enough work and I don't need a potential mess and sometimes one or both become vindictive in a divorce even if it appears to be a "pleasant one"...
Thank you, makes sense and will do!
Now, if I could just figure out why the 'create a pdf' button isn't working.........
p.s. I'd be a great Walmart greeter, other than I can't stand Walmart. 😉
That is great advice! Amiable so far, but boy, you just never know when that will change.
I'm sure that is solid advice.
Thank you!
And if you decide estimated tax payments are the way to go, have each person make them in their own name. Don't do joint ones. Less for them to fight about and less for the IRS to screw up.
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